Customers impacted by the spectacular 2022 collapse of the once prominent cryptocurrency exchange FTX have secured another round of financial recoveries through settlements with key professional service providers who worked with the exchange. The agreements involve the firm’s former primary outside counsel and its auditor, totaling around $66 million in payouts aimed at addressing allegations tied to fraudulent activities.
Silicon Valley law firm Fenwick & West, which served as lead external legal advisor for FTX’s U.S. entities, has agreed to contribute $54 million.
Plaintiffs in the class-action case alleged that the firm assisted in developing structures and strategies that enabled the misuse of customer deposits by FTX founder Sam Bankman-Fried.
A preliminary settlement agreement was submitted to the US District Court in Miami, Florida, on Friday, and it awaits judicial approval.
Auditing firm Prager Metis will pay $11.75 million as part of its separate resolution. Additionally, former NBA player Udonis Haslem, who had promotional connections to FTX, has agreed to contribute $420,000.
These three resolutions together make up the second batch of settlements in the ongoing multidistrict litigation, amounting to roughly $66.17 million.
Fenwick & West has firmly rejected any claims of misconduct, stating it had no awareness of the fraud at FTX and stands by the quality of its legal services.
The settlement specifically resolves the class-action claims in the Miami federal court but leaves untouched a separate $525 million civil suit filed against the firm and certain partners in Washington, D.C.
The FTX bankruptcy, filed in November 2022, exposed an estimated $8 billion shortfall in customer assets due to widespread fraud.
Bankman-Fried was convicted on multiple counts and received a 25-year prison sentence.
The scandal highlighted vulnerabilities in the crypto sector and raised questions about the responsibilities of professional advisors working with high-growth fintech companies.
As first reported by Reuters, these latest payouts add to earlier recoveries distributed through the bankruptcy process and prior settlements.
While the amounts represent only a portion of total losses, they reflect continued efforts by affected users to hold accountable those who provided support services to FTX during its rise.
Legal observers point out that such agreements may encourage greater diligence among law firms, auditors, and promoters engaged with digital asset businesses.
The developments come amid broader regulatory tightening in cryptocurrency markets, where service providers face heightened expectations for due diligence and risk assessment. As remaining claims proceed, including the independent Washington lawsuit, the FTX case continues to underscore the importance of transparency and oversight in emerging financial technologies.
